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Market Vectors Semiconductor ETF (SMH)

- NYSEARCA
  • Jul. 23, 2014, 12:25 PM
    • Among the year's best tech performers, chip stocks are selling off (SOXX -1.8%) on an up day for the Nasdaq following weak numbers from FPGA giant Xilinx (XLNX -14.5%).
    • Xilinx missed FQ1 revenue estimates by over $18M, and also guided for FQ2 revenue to be well below consensus. The company blamed the FQ1 shortfall on soft defense and wireless sales. BMO and BofA/Merrill have downgraded Xilinx; the former thinks Xilinx's 28nm share might be peaking.
    • Xilinx stated on its CC (transcript) the wireless weakness was mostly due to soft 28nm chip sales to Chinese 4G base station vendors; Chinese 4G rollouts have long been viewed as a catalyst for both Xilinx and Altera (ALTR -4.7%). Aerospace/defense sales were hurt by program timing issues.
    • Meanwhile, switch/router vendor Juniper offered light Q3 guidance to go with a Q2 beat. The company noted on its CC (transcript) "market dynamics" for U.S. carriers, including M&A activity, are affecting project rollouts.
    • Also: Analog/mixed-signal IC vendor Linear (LLTC -4.1%) is selling off in spite of beating FQ4 estimates and guiding in-line (8%-11% Y/Y FQ1 rev. growth vs. 9.1% consensus).
    • Notable decliners: FSL -5.3%. IDTI -6.4%. EZCH -3.3%. PMCS -4.3%. LSCC -6.8%. CAVM -4.7%. SMTC -4.1%. ATML -3.2%. TQNT -3.1%. RFMD -2.9%. IRF -2.9%.
    • Qualcomm, NXP, TriQuint, and Cirrus Logic report after the bell.
    • Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | 2 Comments
  • Jul. 10, 2014, 7:09 PM
    • Gartner now expects global semiconductor sales 6.7% Y/Y in 2014 to $336B; the firm previously forecast 5.4% growth.
    • DRAM sales, boosted by strong pricing, are expected to grow 18.8%. But Gartner adds many other industry segments, including ASICs, FPGAs, analog chips, and non-optical sensors, are also doing well. As one would expect, mobile hardware demand is fueling much of the growth.
    • Trade group SEMI recently estimated global chip equipment sales would rise 20.8% this year to $38.4B, and 10.8% in 2015 to $42.6B. Investments in cutting-edge manufacturing technologies (3D transistors, 3D NAND flash, 14nm) is driving much of the growth.
    • Is a lot of the good news priced in? The Philadelphia Semi Index (SOXX) has easily outperformed the Nasdaq this year, thanks to optimism about improving growth and industry consolidation. Benchmark observed today inventories have been rising for much of the semi supply chain.
    • Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | Comment!
  • Jul. 7, 2014, 3:56 AM
    • The U.S. has warned China that treaties and other global negotiations could be in danger if negotiations fail regarding their high-tech product international trade agreement. The agreement includes an annual $2T in trade, and eliminates tariffs and other trade barriers on IT products.
    • China has recently excluded approximately 60 new product categories, including medical devices and next-generation silicon chips, from the trade agreement. American authorities are looking to use this week’s annual U.S.-China Strategic and Economic Dialogue to update the 1996 Information Technology Agreement.
    • U.S. officials warn that if an agreement is not reached, increased opposition will be taken in Congress toward other trade deals with China.
    • ETFs: XLK, VGT, FDN, SOXL, KWEB, TECL, USD, SMH, PNQI, IYZ, TDIV, IYW, ROM, VOX, CQQQ, SOXX, QQQC, XSD, SOXS, PBS, TECS, FTEC, IGV, RYT, IGM, QTEC, PSCT, FXL, IGN, PSI, MTK, SSG, REW, PXQ, XSW, XTL, PSJ, PTF, FCOM, LTL, TLL
    | 1 Comment
  • Jun. 9, 2014, 10:36 AM
    • A slew of chip stocks are rallying following Analog Devices' (ADI +5.9%) $2B deal to acquire RFIC vendor Hittite Microwave.
    • The purchase is part of an M&A wave that has hit the semiconductor industry over the last 12 months, as chipmakers try to gain scale, cut opex, and grow their cross-selling opportunities by consolidating. Other deals: RF Micro/TriQuint, Avago/LSI, Microchip/ISSC.
    • ADI, which shares many telecom equipment, defense/aerospace, and automotive clients with Hittite, predicts Hittite's RF, microwave, and millimeter wave ICs will complement its RF and signal-conversion (ADC/DAC) products.
    • Several RF and analog/mixed signal chipmakers are higher, but they're not the only gainers: RFMD +1.8%. TQNT +1.8%. PSMI +2.5%. LLTC +1.6%. MSCC +2.1%. IDTI +3.8%. ATML +3.4%. IRF +1.4%. SIGM +3.9%. AMCC +3.8%.
    • Chip ETFs: SOXX, SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | Comment!
  • May. 22, 2014, 9:28 AM
    • Microchip (MCHP) is paying NT$143/share ($4.74/share) in cash to acquire all outstanding ISSC shares on Taiwan's GreTai Securities Market. The deal has an equity value of $328.5M, and an enterprise value (excludes net cash) of $294.3M. It's expected to close later in 2014.
    • ISSC had 2013 revenue of $69.2M, and an op. margin of 18.9% The company's Bluetooth ICs for headsets, PC peripherals, car stereos, speakers, and game controllers, among other products.
    • Microchip, which sells microcontrollers and other products into many of ISSC's markets, expects the deal to be immediately accretive. The company no doubt hopes to tap a growing market for embedded/wearable Bluetooth-enabled devices.
    • Is a semi consolidation wave underway? The deal is the latest in a string of industry mergers/acquisitions that includes Avago/LSI and RF Micro/TriQuint. RBC recently cited the industry's transition into "a more mature era" as a reason for becoming bullish on it.
    • Chip ETFs: SOXX, SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | Comment!
  • May. 19, 2014, 10:26 AM
    • In a bullish call on chip stocks, RBC's Doug Freedman has upgraded Nvidia (NVDA +2.9%), Broadcom (BRCM +1.8%), Micron (MU +3.3%), Texas Instruments (TXN +1.3%), and Altera (ALTR +1.8%) to Outperform.
    • Freedman sees the industry's free cash flow profile improving as it transitions "into a more mature era," and companies embrace more "shareholder-friendly capital-allocation strategies."
    • Nvidia, TI, and Altera have already announced major cash-return efforts in recent years. TI has promised to return all of its FCF to shareholders, save for funds needed to pay down debt.
    • Micron (just digested Elpida) and Broadcom have been more cautious, though the latter did hike its dividend in January.
    • Freedman downgraded Micron on Jan. 3, when shares were at $21.66. He was bullish during the company's big 2012/2013 rally.
    • Chip ETFs: SOXX, SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | 1 Comment
  • Apr. 16, 2014, 1:47 PM
    • Though the Nasdaq is up 0.7%, many chip stocks are heading in the opposite direction (SOXX -0.6%) after Intel provided mixed Q1 top-line numbers for its business units - server chip sales were healthy, mobile sales were weak, and PC sales were in between - ASML lowered its 1H14 sales outlook and provided cautious 2H remarks (has dinged many chip equipment stocks), and Linear offered somewhat soft March quarter guidance.
    • Notable decliners: CRUS -3.3%. ENTR -3.3%. QUIK -2.4%CAVM -2%. PSMI -3.6%. ADI -2.3%. TXN -1.4%. MXIM -1.5%. FCS -1.5%. The last four companies all compete against Linear.
    • Himax (HIMX -1.5%) is off after Chardan Capital lowered its PT to $9 from $12; the firm downgraded Himax in January. Shares tumbled on Monday, then ticked higher on Tuesday following a Q1 pre-announcement.
    • Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | Comment!
  • Apr. 15, 2014, 1:49 PM
    • While broader equity markets are only seeing modest declines, tech stocks aren't so lucky. The Nasdaq-100 (QQQ -0.8%) had its lowest print since October this morning before recovering slightly.
    • Chinese tech stocks (KWEB -4.3%), including 2013 solar high-flyers (TAN -4.2%), are especially hard-hit following a Shanghai selloff triggered by PBOC withdrawals. Other Internet (PNQI -2.3%) and social media (SOCL -2%) stocks aren't faring much better.
    • Will earnings season come to the rescue? Intel and Yahoo report after the bell today, and Google and IBM after the bell tomorrow.
    • Tech ETFs: XLK, VGT, FDN, ROBO, SOXL, SKYY, TECL, USD, SMH, IPK, IYW, ROM, TDIV, SOXS, SOXX, KWT, TECS, XSD, IXN, IGV, FTEC, RYT, IGM, PXN, QTEC, PSCT, FXL, IGN, PSI, SSG, MTK, REW, PXQ, XSW, FONE, PSJ, AAIT, PTF, CQQQ, QQQC
    • Update: Tech stocks rallied in the final hours of trading. The Nasdaq closed up 0.3%.
    | 1 Comment
  • Feb. 26, 2014, 11:24 AM
    • Chip stocks are outperforming (SOXX +1.1%) after Avago (AVGO +5.1%) posted an FQ1 beat and strong margin numbers (albeit while guiding light, as many expected), and STMicroelectronics (STM +3.9%) exec Paul Grimme states his company's European sales are stabilizing, with Germany leading the way.
    • Notable winners: AMBA +5.4%. AMCC +5.2%. CRUS +3.3%. SWKS +3%. QUIK +4.1%. INVN +2.7%. RFMD +3.5%. TQNT +3%. SIMO +2.7%. CAVM +3.6%. Nearly all of the aforementioned names have strong mobile and/or telecom equipment exposure.
    • RBC has hiked its Avago PT to $66 from $64, and says the chipmaker remains its "top play on China and global LTE deployments." With LSI in tow, the firm thinks FY15 (ends Oct. '15) EPS will top $5.
    • Morgan Stanley ($68 PT) is confident Avago can raise LSI's op. margin to 30% from 17% over the next few years, much as the company has doubled its own op. margin to 30% post-LBO.
    • Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | Comment!
  • Jan. 14, 2014, 5:42 PM
    • PC industry names outperformed amid a broader tech rally, aided by a JPMorgan Intel (INTC +4%) note that argued PC demand is stabilizing, and tablet cannibalization diminishing. A number of chip stocks also rallied strongly (SOXX +2.1%).
    • Also: Major hard drive suspension assembly maker Hutchinson has reported above-consensus Dec. quarter sales, while citing strong demand for 2.5" notebook drive assemblies. Seagate and Western Digital both rallied.
    • JPMorgan's Christopher Danely, who upgraded Intel to Overweight, has raised his 2014 estimates soundly above consensus ahead of the chip giant's Thursday Q4 report. Danely notes Intel, Microsoft, H-P, and others have said PC demand is improving, and that Taiwan's big-4 notebook contract manufacturers collectively grew their shipments 7% Q/Q in Q4. Q1 shipments are expected to drop in-line with seasonality.
    • He also points out tablet shipment growth is decelerating, and forecasts shipments will only rise 25% in 2014 (down from 53% in 2013).
    • Danely's optimism contrasts with another bearish Intel note from Bernstein's Stacy Rasgon, who estimates five mobile CPU sales are needed to make up for one PC CPU sale, and doubts Intel's foundry business will move the needle.
    • PC industry gainers: MSFT +2.3%. HPQ +2.6%. AMD +4.1%. NVDA +3.1%.
    • Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    • Previous: Goldman on Intel's Q4, Gartner/IDC's Q4 PC estimates, Intel's light 2014 guidance
    | 14 Comments
  • Dec. 17, 2013, 2:57 PM
    • Avago (AVGO +7.6%) is now up 18% (good for a $2.1B increase in market cap) since announcing a $6.6B deal to acquire LSI yesterday morning. Many of its chip industry peers have also rallied; the Philadelphia Semiconductor Index (SOXX +1.2%) is up 2.5% over the last two days.
    • The sharply contrasting nature of Avago and LSI's product lines - Avago depends heavily on RF and optical component sales, while LSI depends on storage controllers/adapters and network processors - could be fueling hopes other chipmakers will use M&A to expand their product lines and achieve greater scale.
    • Today's notable gainers include EZchip (EZCH +6.7%), OmniVision (OVTI +3.6%), Skyworks (SWKS +3%), Cavium (CAVM +3%), Audience (ADNC +5.8%), Cirrus Logic (CRUS +3.4%), and Semtech (SMTC +3%). Cirrus and OmniVision, which both depend heavily on Apple orders, might also be getting a boost from a positive Q4 pre-announcement from Germany's Dialog Semi (gets ~70% of its sales from Apple).
    • Several firms have hiked their Avago PTs in response to the LSI deal, which is set to be financed with $4.6B in debt and a $1B convertible note investment from Silver Lake (conversion price of just $48.04). Nomura expects the deal to lift Avago's 2015 EPS by $1.00-$1.50; Avago is promising $200M/year in synergies by the end of FY15 (ends Nov. '15). RBC thinks FY15 EPS of ~$5 is possible; the consensus is at $3.89.
    • Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | Comment!
  • Dec. 12, 2013, 2:58 PM
    • TSMC (TSM -1.8%), estimated to have ~50% of the global chip foundry services market, thinks the market's growth will slow to 9% in 2014 from 11% in 2013. At the same time, the company thinks total chip industry growth will increase to 5% from 2013's 4%. Trade association WSTS has forecast 4.4% 2013 growth and 4.1% 2014 growth.
    • Foundries have been steadily growing their share of chip industry output for years, as the exorbitant cost of building new fabs leads more and more chipmakers to outsource manufacturing. But with dozens of major chipmakers already fully relying on foundries, the market could be hard-pressed to significantly outpace broader industry growth going forward.
    • Other foundries: UMC, SMI, TSEM
    • Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | Comment!
  • Oct. 23, 2013, 10:19 AM
    | 12 Comments
  • Oct. 18, 2013, 12:35 PM
    • Wells Fargo's David Wong has cut his rating for the semiconductor industry to Market Perform, citing Intel and TSMC's (TSM +1.6%) Q4 guidance, and downbeat commentary from tech companies about electronics demand. That, along with an adverse reaction to AMD's Q3 numbers and Q4 guidance, is leading chip stocks to underperform (SOXX -0.2%) on a day when Internet stocks are flying higher thanks to Google.
    • Intel's guidance for seasonally strong Q4 implies only a 2% Q/Q sales increase at the midpoint. TSMC, which delivered its Q3 results yesterday, is guiding for Q4 revenue to fall to NT$144B-$147B ($4.9B-$5B) from Q3's NT$162.58B ($5.53B).
    • Though Q4 tends to be seasonally weak for foundries, TSMC did partly attribute its guidance to customer inventory adjustments and softening high-end mobile device demand.
    • Wong's downgrade is accompanied by ratings cuts for analog chipmakers International Rectifier and Monolithic Power. It comes two weeks after trade association SIA reported global chip sales rose 6.4% Y/Y in August; that was the fastest growth rate posted since March '11.
    • Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    | 1 Comment
  • Oct. 4, 2013, 6:25 PM
    • Trade association SIA estimates global chip sales rose 1.3% M/M and 6.4% Y/Y in August, the Y/Y figure represents not only an improvement from July's 5.1%, but the highest growth rate seen since March '11.
    • While strong memory chip sales (aided by mobile demand and favorable pricing) naturally contributed to the growth, SIA says demand for non-memory products also rose. The growth comes in spite of soft demand for PCs, home electronics, and servers.
    • Chip ETFs: SOXX, SMH, XSD, PSI, SOXL, USD, SOXS, SSG
    • Earlier: Micron, SanDisk, mobile chipmakers rally following Samsung forecast
    | Comment!
  • Jul. 24, 2013, 3:57 PM
    CEVA (CEVA -12.8%) is ending the day with huge losses after Broadcom, which uses CEVA's DSP cores in its baseband chips, missed Q2 estimates and issued light Q3 guidance, while blaming the shortfall in large part on light baseband sales. Chip stocks on the whole have had a bad day (SOXX -1.8%), as Broadcom's numbers and a ho-hum report from ARM overshadow Apple's FQ3 beat. SIMG -3.8%. OVTI -2.8%. MU -3.9%. SNDK -2.4%. IMOS -4.5%. Broadcom set-top chip rival STMicroelectronics (STM -2.7%) has fallen for the second day in a row following its Q2 report and soft Q3 guidance, aided by a downgrade to Underperform from BofA.
    | Comment!
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SMH Description
The Market Vectors®Semiconductor ETF (SMH) seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the Market Vectors US Listed Semiconductor 25 Index (MVSMHTR). The Index is a rules-based index intended to track the overall performance of 25 of the largest U.S. listed, publicly traded semiconductor companies.
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Country: United States
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